Bhushan Power gets funding from Baring Pvt Equity

Mumbai, December 14, 2006: New Delhi-based Bhushan Power & Steel (BPSL) announced it has received Rs 150 crore in private equity funding from an affiliate of leading global private equity investor Baring Private Equity Asia. . UTI Bank Limited acted as sole advisor to this transaction.

Speaking on the occasion, Mr Sanjay Singal, Chairman and Managing Director of BPSL said: "We are extremely happy that a discerning global investor such as Baring Private Equity Asia has affirmed its faith in our business plans. The funds will be utilised for our integrated steel complex being set up in Orissa. BPSL will become a 1.2 million ton integrated steel company after the Orissa plant is fully commissioned, by December 2007. Expansion activity at the plant is proceeding ahead of schedule. With Baring as an advisor and an equity partner, we expect to deliver our world-class steel to an ever-increasing roster of global clients."

Baring Private Equity Asia chairman & CEO, Mr. Jean Eric Salata, said: "As investors, we believe that the infrastructure, construction and engineering sector is one of the most vibrant investment themes in India. BPSL is very well positioned to benefit from the strong macro economic trends that underly this sector. We are extremely pleased that BPSL's backward integration plan at its facilities in Orissa, which will result in a substantial increase in profitability for the company, is proceeding ahead of schedule. We have been very impressed with management's operational and project management execution capability."

About Bhushan Power & Steel

The Rs 2,500 crore Bhushan Power & Steel has plants in Chandigarh, Derabassi (Punjab), Kolkata (West Bengal) and in the Sambalpur District of Orissa. The company is currently in the process of implementing Phase-II of its integrated steel complex in Orissa. The Orissa plant marks a strategic entry into the primary steel segment, and gives the company a major logistic edge owing to its close proximity of two basic inputs i.e. Iron Ore and Coal.

The company has already been allotted two coal mines in Orissa, just 70 kms away from the plant site. Phase-I of the project, comprising 0.6 million tonnes of sponge iron plant, 0.30 million tonnes of billets and a 100 MW power plant, has already been completed as per schedule and has gone into production. According to the project implementation plan, the blast furnace, Coke Oven and Sinter plants are expected to be commissioned by March 2007, and the remaining facilities""Oxygen plant, lime and dolomite facilities, steel making facilities and HR coil plants are expected to be commissioned by December 2007.

However, overall implementation of the project is running ahead of schedule, one of Electric Arc Furnace and Oxygen plant are expected to be commissioned by January, 2007. Phase-I of the Orissa Project entailed a capital outlay of Rs 830 crores, and Phase-II is being implemented at a projected outlay of Rs 2900 crores.

BPSL reported a 77 per cent growth in profit after tax, at Rs 170 crores on a 17 per cent increase in turnover to Rs 2385 crores in the financial year ended March 31, 2006.

About Baring Private Equity Asia

Baring Private Equity Asia Group is an independent firm specialising in growth capital financings and buyouts of mid-sized companies in Asia, principally in China , India and Japan.

It advises funds with over US$1 billion in assets, ranking it among the 15 largest private equity firms in Asia. Baring Asia distinguishes itself through a flexible, long-term partnership approach with management, supported by in-depth industry knowledge and extensive regional connections.